Category Archives: New Home Trends

As single-family homes get bigger, tomorrow’s buyers seem to prefer efficiency and location over square footage

In 2000, the average new apartment built in the U.S. measured 1,003 square feet, according to Dallas-based research firm Axiometrics. By 2010, that square footage shrunk to 976. It wasn’t a huge decline, but after three decades of growth, the falloff was noticeable. During the recession, the average new single-family house was 2,135 square feet; by 2013, that number mushroomed to 2,598 square feet. Suddenly, the McMansion was back.

What gives? Market trends are increasingly pushing the housing market into a barbell with smaller apartments (including micro units) on one side and McMansions on the other. To most observers, that’s a surprise. Coming out of the recession, conventional wisdom says that cash-strapped consumers would have to—and want to—cut back on house size.

“All you read is that the consumer wants less and they don’t want a big house,” says Brian Cullen, president of Corbelis Development NoVa. Corbelis is the developer at Willowsford, a 4,000-acre planned community in Loudoun County, Va. “We started [at Willowsford] with small thinking, but the national numbers suggest that the average single-family detached house is bigger than it was in 2005. At the end of the day, when people are buying a house, they don’t want to give up what they already had.”

But the millennials inhabiting high-tech, yet cozy student housing and apartments don’t have outsized space expectations. Over the next decade, their preference for the walkable convenience that often accompanies smaller living spaces will collide head on with their parents’ (and grandparents’) insatiable addiction for square footage.

Will millennials’ maturation force home builders to come up with walkable communities and smaller, more innovative homes that might, finally, kill the McMansion? Or will it lead millennials to make the decision to abandon walkability and convenience for more square footage?

No one really knows the answers to these questions, but trends demonstrate that Gen Yers—many of whom currently are living in student housing and apartments—have different expectations than the generations before them. Even if they eventually end up in single-family homes in the suburbs, their acceptance of efficient spaces might change the game for many builders. But without public policy changes and rethinking what home value really means, their preferences for efficient spaces may do little to cut square footage.

Shrinking the House

“There’s a combination of a kitchen and family room with a little dining area,” he explains. “There are much more open floor spaces, and there are positive cost implications because you’re building fewer walls.”

Even if millennials do follow their parents’ path to the suburbs, many architects predict (and hope) that the efficient designs they’ve become accustomed to in college and apartments will follow them to their single-family home.

“I’m hoping this is the generation [that pulls in house size] because our generation went gigantic,” Thatch says. “It’s a chance for architects to get back to design smaller, more thoughtful spaces that are flexible.”

Others agree with Thatch and contend that, by duplicating designs in these apartments, architects could help reel in square footage. “Apartments have gotten smaller,” Woodley says. “And as an industry we’ve gotten good at thinking about how people use the space versus just adding space.”

Kitchens and dining rooms are two areas where architects are finding smaller, flexible spots. Maybe there’s an island in the kitchen instead of table, which is commonplace in today’s apartments. At Willowsford, which still has homes in the 2,300-square-foot to 5,400-square-foot range, Cullen says a lot of the models no longer have living rooms.

Other traditional spaces are on their way out as well. “People are disregarding the traditional formalities that once were considered essential staples,” says Howard Englander, who oversees architecture for Walnut, Calif.–based Shea Homes. “For instance, the living room is obsolete, dated, and archaic. Very few builders are delivering the traditional living room.”

Cullen also sees a fusion of indoor and outdoor space with living areas off the family room, the kitchen, and the master bedroom. On smaller lots, Thatch has another way to conserve space that borrows directly from the apartment industry. “The other thing is looking at the rooftop as your backyard,” he suggests, “although people are afraid of the waterproofing issue.”

For Shea Homes, Woodley has brought loft-style designs to for-sale homes with the master bedroom overlooking the living space. “It’s really for the young couple or young professional single,” he says. “We think about how they use [space] versus just putting raw footage in it, which is different than the mid ’90s when it was just about more house and less money.”

More open floor plans also curtail the need for extra square footage, and not just by eliminating walls. “When you open up spaces and don’t define everything by three walls, you’re creating a bigger visual sensation and buyers want that,” Englander explains. “They want to see expanded vistas throughout the house.”

But then in other places, space is being added in to compensate for what’s being pulled out. “I do find it very interesting that people come in and the first thing they want is build a smaller house,” Woodley says. “They don’t need a formal living room or formal dining room, but they do need a big play room. Part of it is everyone is willing to compromise until they have to compromise.”

The Challenge

In the early 1990s, James Wentling, principal at James Wentling/Architects in Philadelphia, designed a number of communities with new homes in the 1,300- to 1,200-square-foot range. But he says that’s been hard to do recently. “That’s just not happening anymore because the entitlements are so difficult that builders really can’t do much below 2,000 to 2,200 square feet,” Wentling says. “They may be more willing to accept smaller square footage if it can be delivered.”

What’s occurred is that convenience is unattainable for most people. “The thing about walkable communities is who doesn’t want them?” Wentling asks. “But it’s hard to create that dynamic at a reasonable cost.”

Lehnert also sees local zoning regulations as an obstacle to building smaller, more affordable homes. If a jurisdiction specifies two-car garages, for instance, it’s hard to reduce square footage in the overall house. “We’re in kind of a transition zone until somebody steps up because the cities have their own criteria and design guidelines that make it impossible to get any density,” he says. “As long we can’t get density, we can’t get the land value to reflect something that would make the land available to these kids.”

Many of these local policies reflect the prevailing opinion in many jurisdictions. “We were in a city without a development for 30 years and we proposed something below a 4,000- to 5,000-square-foot lot and the public outcry was insane, absolutely incredible,” Lehnert recalls. “A lot of public officials just caved when the outcry started to occur because it’s the easier way out.”

Builder hesitancy also gets in the way of cutting back on square footage. With super-tight margins on entry-level product and diminished lot supplies, many builders would rather focus on the higher end of the market, where they can juice returns. Part of the problem when reducing square footage isn’t just building smaller homes in dense infill communities—it’s also difficult to reduce the size in mammoth single-family homes. Consider the role realtors play.

“At the end of the day, the builders come back to a price per square foot that the market is buying,” Cullen notes. “The realtor community will say, ‘You can’t pay over $2.10 a square foot.’ If I built this really cool house and I’ve crunched its square footage by 20 percent but now the buyer pays $2.30 a square foot, the realtors who represent 85 percent of my buyers are saying, ‘You can go across the street and get this other house for $2.10 and you’re buying more square footage.”

Micro Living: Architect Michael Woodley has designed micro homes, but builders seem to prefer working on townhomes, such as Shea Homes’ Frame and Focus project in San Diego.

At that point, it’s a minimal cost for a builder to add more square footage per room, and they’ll gladly do it to remain competitive in the market. “They’ve allocated square footage differently and it fits in the realtors’ mind as acceptable for price per square foot,” Cullen says.

But Woodley is hopeful that millennials are the generation that will destroy these sacred cows of housing. “If it’s more thoughtful, more efficient, a better use of space, and a better design, that’s what entices the younger buyer, not the idea of what excited their parents,” Woodley says. “This buyer is not nostalgic at all about aesthetics. They’re not trying to create something their parents have.”

EdR’s Kenner agrees with Woodley’s assessment, adding that he thinks millennials are “definitely pulling away from the McMansion of their parents.”

What are some of the most popular home features luring home buyers? The real estate brokerage Redfin surveyed 435 of its real estate professionals across the country to find out what the biggest real estate trends are with home features.

According to the survey, real estate professionals identified the following features as the most popular among home buyers:

• Open floor plans

• Move-in-ready homes

• Granite in areas such as bathrooms or kitchens

• Upgraded windows

• Locations near public transportation

• Energy-saving appliances

• Large closets

• Updated lighting fixtures

• Two-story home with a bedroom on the main floor

• Wood floors

The survey revealed the following home features are not popular with home buyers:

When young families choose a place to settle down, they look for more than affordable homes. Homeownership is a more complex decision than that – it means investing in your community and all it has to offer, from its public schools to the job market.

We wanted to find the best such communities for young families in Pennsylvania, so we asked the following questions as we analyzed cities and towns across the state:

Does the town have good public schools? We measured schools’ academic performance with ratings from GreatSchools. This non-profit compares a given school’s standardized test scores to the state average to obtain a rating on a 1 to 10 scale (10 representing the highest score). Higher ratings led to a higher overall score.

Can you afford to live there? We looked at both median home values in each town and ongoing monthly home costs, including mortgage payments, real estate taxes, insurance costs, utilities, fuel and other bills. Lower costs led to a higher overall score.

Is the town growing and prospering? We assessed a town’s economy by looking at average household income and income growth over the last decade. Higher income and greater growth led to a higher overall score.

1. Jefferson Hills

Jefferson Hills is a suburb of Pittsburgh, about 15 miles south of the big city. The local school district, West Jefferson Hills, is ranked 15th out of the 104 school systems in the seven-county region around Pittsburgh. Statewide, it fares even better, ranking number 51 out of 497 schools on math, reading and science.

2. Greensburg

Greensburg is the seat of Westmoreland County and is about a 45-minute drive from Pittsburgh. The city supports an arts community with institutions such as the Westmoreland Museum of American Art – which has temporarily relocated until the main building completes renovation – and the Palace Theatre, which brings acts like Cyndi Lauper and the Temptations to town. For outdoorsy families, there is also the Five Star Trail – eight miles of land for biking, jogging and cross-country skiing.

3. Phoenixville

Phoenixville is in Chester County, about 30 miles northwest of Philadelphia. One district is in in the National Register of Historic Places, and it features art galleries, antique stores and restaurants. Residents also have easy access to the Perkiomen Trail, a 19-mile path made of cinder and stone.

4. Broomall

Broomall is an 11,000-person community just outside Philadelphia. The local school district, Marple Newtown, offers 16 AP courses and 32 Honors courses. The larger county is also home to Ridley Creek State Park, 2,606 acres of woodlands and meadows where residents can hike, bike and fish.

5. Lansdale

Lansdale is a borough of Montgomery County about 30 miles northwest of Philadelphia. A local high school, North Penn, was recognized by Newsweek earlier this year as one of the best high schools in America. In particular, the school was distinguished for producing college-ready students: 95 percent of students graduate, and 89 percent go on to higher education.

6. Emmaus

Emmaus is a borough of Lehigh County, near Allentown. Money Magazine ranked it as one of the 100 best places to live in the U.S. both in 2007 and 2009. The larger Lehigh Valley region includes two Fortune 500 companies, and the economy is becoming increasingly focused on high-tech industries, including biotechnology, pharmaceuticals and optoelectronics.

7. Willow Grove

Willow Grove is a suburb of Philadelphia in Montgomery County. The local school district is excellent – the community earned an eight out of ten from GreatSchools – and is planning on rolling out a program for its students to earn college credit while still in high school. “We’re getting closer to launching a program designed where students can earn an equivalent of one year of college,” said Superintendent Bob Milrod. The program is expected to launch next year.

8. Hershey

Hershey is a 15,000-person community in Derry Township, about 15 miles from Harrisburg. It has been called Chocolate Town, U.S.A. and the Sweetest Place on Earth because the chocolates of the same name are made here. The community is more than just a tourist destination; it is home to excellent schools. Hershey High School was ranked 16th best in the state by U.S. News & World Report earlier this year.

9. Allison Park

Allison Park is a suburb of Pittsburgh in Allegheny County. Had Census data been available for income in 1999, and had we then been able to calculate a growth rate, the community would have ranked even higher. Indeed, its schools, part of Hampton Township School District, have been recognized as some of the best by publications like Forbes, Family Circle Magazine and the Pittsburgh Business Times. The district is also one of three in the county to be recognized by the state Department of Education for making Adequate Yearly Progress for six or more consecutive years.

10. Wyomissing

Wyomissing is a borough of Berks County, in southeastern Pennsylvania. Earlier this year, the Washington Post named Wyomissing Area High School the third-most challenging high school in the state – an evaluation based on the number of students taking college-level exams, including AP and IB. The borough also includes over 175 acres of parkland, including picnic areas and trails.

Rank

City

Nearest big city

GreatSchools rating

Median home value

Monthly owner costs

Median household income

Growth,’99-’11

Overall score for young families

1

Jefferson Hills

Pittsburgh

9

$168,100

$1,561

$75,296

48.8%

73.3

2

Greensburg

Pittsburgh

8

$115,600

$1,149

$40,801

34.6%

65.9

3

Phoenixville

Philadelphia

8

$212,000

$1,722

$60,063

41.3%

64.9

4

Broomall

Philadelphia

9

$321,700

$2,066

$70,685

35.0%

64.0

5

Lansdale

Philadelphia

9

$231,200

$1,695

$57,875

25.2%

63.5

6

Emmaus

Allentown

8

$187,900

$1,441

$57,585

30.3%

63.2

7

Willow Grove

Philadelphia

8

$255,300

$1,888

$68,267

35.5%

62.3

8

Hershey

Harrisburg

9

$239,800

$1,876

$55,810

23.8%

62.0

9

Allison Park

Pittsburgh

10

$192,200

$1,704

$78,215

–

61.9

10

Wyomissing

Reading

8

$210,800

$1,884

$70,713

29.3%

61.4

11

Ardmore

Philadelphia

10

$295,600

$2,085

$67,774

11.2%

60.9

12

Butler

Pittsburgh

7

$86,800

$1,002

$31,955

27.0%

60.6

13

Bloomsburg

–

7

$116,100

$1,121

$31,237

25.6%

59.1

14

Bethel Park

Pittsburgh

9

$152,700

$1,472

$65,797

–

59.1

15

Murrysville

Pittsburgh

9

$213,100

$1,733

$87,745

–

58.4

Methodology

The overall score for each city was derived from the following measures:GreatSchools city rating. GreatSchools city ratings are calculated by averaging the weighted overall rating for each school in the city (weighted by the number of students enrolled at the school)

Median home value from the U.S. Census (2011 ACS, data set DP04, half-weighted)

Monthly homeowner costs from the U.S. Census (2011 ACS, data set DP04, half-weighted)

Median household income from the U.S. Census (2011 ACS, data set DP03, half-weighted)

Income change between 1999 and 2011 from the U.S. Census (data sets P053 and DP03, half-weighted)

90 Pennsylvania cities and towns designated as places by the U.S. Census were included in this analysis. Only places with a population greater than 10,000 were considered

(MCT)—For years, traditional gas-powered tank water heaters have been one of the biggest energy hogs in the home. With tank heaters, you have to pay to heat water you aren’t even using. Not so with a tankless water heater.

“It’s truly an on-demand hot water heater,” says Kyle Whelpley, operations manager for J.F. Denney Plumbing and Heating Inc. in Leavenworth, Kan. “It does nothing until you turn on your hot water. So, when you’re at work, it simply hangs on the wall and doesn’t cost you one penny, compared to a 40- or 50-gallon tank, where, when you’re at work you’re paying for it. Here in the Midwest, a 50-gallon natural gas water heater’s yearly cost is about $360. A (comparably-sized gas tankless) is about $190.”

Tankless water heaters are a fraction of the size of tank systems—roughly the size of a circuit breaker box—and mount to a wall instead of taking up valuable space in the basement or garage. “Some people really like the fact they have their space back, once they get a tankless installed,” says Rob Evans of Mr. Rooter of Columbus, Ga.

The most popular benefit of a tankless water heater, though, is an almost endless supply of hot water it provides by heating the water via an internal heat exchanger. “A tankless water heater is designed so that, if you wanted to, you could take a shower from 8 a.m. until midnight at 115 degrees and it won’t move one degree,” Whelpley says. “It’s truly endless hot water.”
Though gas tankless water heaters cost about twice as much as their conventional predecessors — ranging from $2,500 to $5,000 on average — they are easily repairable compared to a tank unit that usually needs to be replaced when it fails. Tankless heaters last 20 years on average and are more energy efficient, making them more environmentally friendly than the traditional models. Qualifying tankless water heaters are eligible for a $300 federal tax credit. Some utility providers also offer rebates for qualifying purchases.
“A tank water heater lasts about nine years on average,” Evans says. “A tankless generally lasts twice that long. So, even though the initial upfront costs can be quite a bit, over the long haul it’s cheaper because you don’t have to replace the water heater nine years down the road.”

Electric tankless heaters are available as well, but use a lot of power and typically require the electrical service to be upgraded. Electric heaters are best for limited use, such as a small apartment or a point-of-use application like a dedicated sink where you need plenty of hot water.

Tankless water heaters require minimal maintenance, other than periodic flushing to descale them of mineral buildup. A plumber can do that service, typically for around $100 to $150. A handy homeowner can clean the system with vinegar if he or she follows the manufacturer’s recommended guidelines for descaling. It’s also recommended homeowners have a water softener to reduce scale buildup.
“You can tell a difference on ones that have water softeners and ones that don’t have water softeners,” Whelpley says. “When you heat up the water that quickly, you bring the calcium out even quicker.”

Tankless water heaters do require venting and should be placed close to gas lines to operate at their highest efficiency. A licensed plumber who has a good history of working with tankless heaters can help ensure it’s installed correctly and is properly sized to accommodate your family’s needs.

“The biggest thing is to make sure you get somebody that knows tankless and deals with tankless day in and day out,” Whelpley says. “The biggest thing I see is people go to (a big box hardware store) and see a tankless and say, ‘I’ll take that,’ but they don’t know that you have to size it for the house. How many shower heads do you have? How many Jacuzzi tubs do you have? If you go buy one off the shelf that’s a 5-gallon a minute when you really need a 9-gallon a minute and you have one person taking a shower in the master bathroom and another person goes to take a shower in the guest bathroom, you won’t have (enough water pressure).”